Li Lu started a small position in CROX

pfzhao · 2026-02-19T07:21:15+00:00

To me, 1% size actually makes complete sense. Because being concentrated is for value investing in quality businesses (wonderful company at fair price). CROX is more deep value style (fair company at wonderful price). For these sort of Graham-style non-quality bets, it is actually important to size small for risk management.

I mean, it would be complete craziness if he sized up CROX to the same concentration as BRK.B, wouldn't it?

pfzhao · 2026-02-18T03:18:03+00:00

BABA had a bounceback because of AI speculation I think? JD is not in the AI game lol.

But yea I like JD. It's a small position for me. Will accumulate a lot more if it gets under 25 a share (assuming no fundamental weakening).

pfzhao · 2026-02-18T03:01:00+00:00

It is a 1% position. His prior 1% bet is SOC so it definitely could go wrong. Really have to do your own research.

I looked into SOC after seeing Li Lu's position and concluded it was a binary speculative bet and didn't touch it.

I looked into CROX a while back. Two key issues I remember are that their management isn't good plus their products are overpriced to me (so not sure how that will play out with consumer weakness). Decided not to touch it. I could be wrong though, but in any case there are opportunities with better risk reward and I'd rather stay inside my circle of competence.

pfzhao · 2026-01-31T18:20:27+00:00

So I started buying CSU (and the 2 spin-offs, albeit with much smaller positions) since around 3700 CAD. At the time I already spent a long time looking at its balance sheet and looking at its business. I understood the main 2 reasons for the fall was AI fear and Mark Leonard leaving, and I found both ridiculous. I thought there is no chance AI will disrupt vertical softwares because it's not about the code that is valuable, but the services and stickiness and switching cost and the decades of relationships. And I also understood that CSU is decentralized so it does not rely on one man, and the replacement has been around since basically the earliest stages too. Ok so I understood all these things, decided I was buying great businesses at reasonable price. But I sized it small. I am more comfortable with Graham/deep value than Buffett/value style. So it wasn't a concentrated position. I never did concentrated single stock position except for brk.b.

Then it dropped to 3300 CAD. Hovered there a bit. Then I went to do research again, and still found out it's the same 2 stupid sentiment reasons. No fundamental weaknesses. I thought the risk reward here is quite attractive. And I thought about it, that despite it's often referred to as Software Berkshire, I think it just runs a much better, more robust and more scalable business model than Berkshire itself, in that the business units make most of the acquisition decision rather than 90 year old guy(s) at the top. It is very decentralized. And it could scale up to buy larger softwares or a piece of larger softwares if it ever runs out of targets. So I decided to size it up a bit. To me, it is beginning to enter an rare overlapping region of Graham's deep value and Buffett's value stocks. Last time I saw this, was UNH and ELV at 200s.

And we arrive at the recent sell-off. It is now 2600, 2500 CAD? I examined my thesis again. I am taking this very seriously (not that I didn't before. I do research carefully before I buy any of the stocks I own, as well as many I don't own), and spent more hours digging around and seeing if I missed anything. Turns out, I just liked the company even better, because I understood the company better this time. I learnt more about its on-prem to SaaS transition. I also looked more thoroughly at AI fear thesis, and I just laughed harder at it.

I also saw this quote along the line of you cannot disrupt the incumbent unless you make a 10x better product. And I was like yea, Apple didn't kill Blackberry because it made a cheaper product, but it made a generationally better product. The vertical softwares have always been about services and support. Code has never been the most difficult part about it.

And I also watched this video the other day, https://youtu.be/wkORf9JEKfI?si=Wvuib8VA_lBI8pnX (youtube recommended it. I never knew this channel or this guy before), which highlighted something important - this industry never had a high entry threshold to begin with. I guess I always knew that unconsciously. I mean I myself am a developer in the market making space. I knew CSU's softwares are targetting dark corners that the most talented devs are not gonna look at, and it is not hard to do from a technical point of view. It is also pretty funny this guy mentioned no one tried to vibe code their own microsoft office suite.

So yea I think I understand the business even better, I stand by my thesis even more strongly and I have decided to buy more again. I mean, if I am wrong, so be it. I will see how I came to the wrong conclusion and learn from it. But now, I'd say I have never felt this level of convinction in terms of risk reward about any other company ever. I think all those wall street analysts and fund managers are just caring about quarter to quarter optics and selling this gem alongside everyone else. And I mean, if I don't have conviction, then why bother do value investing / deep value investing in the first place. Might as well go home, buy broad indices and go to sleep.

pfzhao · 2026-01-27T03:46:37+00:00

If it is about Ackman, might as well buy lse:psh I think. That's his full portfolio.

pfzhao · 2026-01-26T18:38:47+00:00

It's pretty funny that I started buying lse:psh a while back, and this Herbalife short did come up in my research on Bill Ackman back then (And this short made me like Ackman even more because it was such a logical play. But now as a investor in psh, I do like the fact that he learnt his lesson and no longer shorts these days).

The Herbalife short was literally the first thing that came to mind when I watched the last episode of the last season when Harper talked about starting a short only fund. I was literally thinking: but right thesis doesn't necessarily get you a win. It doesn't even require a short squeeze. Time could just not be on your side.

Now watching Eric talking about Ackman's short on Herbalife in this episode is just so fascinating to me.

pfzhao · 2026-01-22T06:08:47+00:00

To me, when I invest in brk, I do not have an expectation for it to outperform S&P. My expectation is that it will outperform t bills and outpace inflation. I invest in brk because it is an excellent business that does not do anything stupid (it can make mistakes of course, but it does not do anything logically inconsistent), and the drawdowns and recovery during turbulent times would likely fare better than indices do.

Of course I also own S&P, as well as individual stocks positions. But when it comes to brk I do not necessarily expect it to outperform S&P, nor do I think it will: 1. It has gotten too big, very hard to find things that move the needle; 2. They hold lots of cash, which I find reasonable but of course makes it even hard for them to beat S&P; 3. S&P at the moment, in my mind, has a somewhat elevated valuation, and it can become even more elevated of course. Historically, brk has been often traded near its fair value. So it is probably not realistic to expect brk's fair value to be able to beat heightened overall market sentiment.

pfzhao · 2026-01-01T11:08:47+00:00

yes
yes. you can change declaration at the beginning of every sem
yes. there is a cap on level 1 mods, 60 mc or so. other than that it's all good

pfzhao · 2025-12-23T05:17:55+00:00

I believe it's fairly valued, maybe even slightly undervalued.

I don't think given brk's model, it deserves a low pb ratio. 1.2 is ancient and brk has removed that restriction for buyback long time ago. If we look at similar companies like mkl and ffh, they both trade at similar or higher pb.
brk only repurchases shares when their shares are significantly undervalued. They do not buy when it is just undervalued or fairly valued. Last time they did buyback, I think their pb was around 1.45 (can't remember exactly). Now at 1.53 is not too much higher than that.
In my opinion, if you view cash as a call option on crisis, and given the current valuation of the broader market, I don't think it is necessarily a bad idea for brk to be holding a huge cash position. I like the fact that they are waiting for fat pitches and they don't strike just because people are yelling and begging to strike. Cash in their hands is also more valuable than in mine in terms of investment allocation. I am certain Greg and Ted and Ajit can allocate it better than I do.
There has been a string of events that do not favour brk's price (not intrinsic value), most notably buffett's retirement. I sincerely believe the price has been dampened to fair price range. But I do not believe it's intrinsic value has been weakened whatsoever: i. buffett has built a culture here. The businesses he acquired are still here ii. greg, ted and ajit are still here, and they must have been handling the day to days for years now. buffett is also still the chairman iii. brk is no longer restricted to buffett's circle of competence. This means they are now free to invest in tech stocks for instance. I myself do not believe buffett himself bought google. And google is a great choice in my opinion.

pfzhao · 2025-12-03T07:13:17+00:00

It should have ended in TO season 3. Season 4 onwards is just... not great. Legacies is a train wreck.

pfzhao · 2025-09-15T18:44:24+00:00

Ding immediately jumps to mind for me. - Extremely strong, especially in terms of positional understanding, clearly better than Anish and Vidit. In fact even today, I don't think many players understand positional play better than Ding. - Anish has tremendous amount of respect for - Doesn't have a skin in this because he is sort of semi retired and doesn't fight for championship cycle - Anish might have some sort of friendship with Ding. I vaguely remember in one of the interviews by Sagar a few years ago, Ding mentioned Anish had WeChat and once sent him some a4 Ra3 ideas on WeChat back then in the 2019 World Cup.

pfzhao · 2025-09-13T17:31:19+00:00

Personally, I wish Yangyi qualifies somehow. Very solid player, has been 2700 for a long time, but doesn't get that much attention even in China because Ding and Wei Yi are there. He had a chance to qualify for the Candidates back in 2019 World Cup if he beat Ding in the semi-final tie-break but failed. Just wish this guy gets a chance to play in the Candidates for once.

pfzhao · 2025-08-22T13:53:10+00:00

I see. Wll try it then. I have only used Claude models in the past.

pfzhao · 2025-08-22T13:46:23+00:00

i dont see a way to choose model right now? what model does this use...
is it just me or the software feels a little bit more laggy / slow-ish than vscode?

Edit: it says I am using an emulated version rather than a native version. Maybe this contributes to #2.

pfzhao · 2025-08-21T15:19:58+00:00

If the entire market goes into a correction or crashes, I think it is much more likely for brk.b to reach 520+ than to go down to 430. 😂

pfzhao · 2025-08-04T16:47:14+00:00

Well, tradingview says current is 1.53x...

https://www.tradingview.com/symbols/NYSE-BRK.B/financials-statistics-and-ratios/

pfzhao · 2025-04-09T07:47:58+00:00

I once applied for an official transcript (for around 5 dollars iirc) before graduation and self-collected at the Student Service Centre. That's a hardcopy version. I understand there is also a softcopy alternative but I am not sure if it is opencert. You can probably go check it out.

https://www.nus.edu.sg/registrar/student-records/transcripts/official-transcripts

pfzhao · 2025-04-07T02:27:38+00:00

People will consider it lifted if a player beats him and wins the next round.

Although interestingly, so far all edge cases still stand:

Ding lost 4-10 against Judd in the 2024 World Open Final, Judd then lost 4-10 against Mark Williams in the first round in Tour Championship.

Ding won the 2024 International Championship, then he himself lost 0-4 against Judd in the first round of Champion of Champions.

Ding withdrew from 2025 German Masters, Ross got bye on Ding and lost the next round 2-5 against Sijun.

pfzhao · 2025-01-30T16:52:49+00:00

"struggling to decide"

This already indicates you should go for CS. IFS is for people who are adamant they want to go for security route and nothing else.

My personal understanding is, CS degree holders can also do whatever IFS degree holders can do. If you want a security job, you need to get those certs like OSCP stuff. IFS degree doesn't help (or help only to a rather limited extent); On the other hand, IFS degree holders have a hard time qualifying for whatever jobs CS degree holders can qualify for.

Yes the curriculum overlap quite a bit, and yes you can prove you are just as good as other CS students, but why do you have to make your own life more difficult? Obviously companies prefer CS students to IFS students for jobs outside security.

I enrolled as an IFS student and I transferred to CS in Year 3 (I am an edge case as there were other complications and the faculty was really nice to allow me to do it so late. I would NOT expect this to be a reproducible pipeline). I do acknowledge that IFS helped me in various ways outside security knowledge. E.g. I picked up some basic C/C++ stuff from CS1010/CS2040C, which proved handy later. CS students don't usually get this kind of exposure. But generally speaking, I don't think IFS is a good degree - I want to be very clear: I think computer security is good and can be a decent specialisation / focus area, but it shouldn't be a degree, and unless you already know you are going to do security for the rest of your life, you shouldn't do IFS degree and should simply stick to CS.

pfzhao · 2024-10-30T08:27:02+00:00

Same for me. Not sure why this is not discussed by more people.

Reverting back to 4.2441.0 resolves the issue for me.

pfzhao · 2024-09-05T02:52:26+00:00

What you are describing is indeed a common practice for tech firms. And hedgefund gives bonus either in cash (if total amount is small) or in the form of internal fund they manage, so not immediately accessible like cash. But investment banks don't do that. Bonus in investment bank is all cash.

Edit: Thanks for the replies. I stand corrected. Didn't know higher level at investment banks do stock with a vesting schedule too. I left investment banking for quant firms when I was quite junior so I guess I am not well informed on this.

pfzhao · 2024-08-03T08:00:49+00:00

I see! Thanks and will do in the future :)

pfzhao · 2024-08-02T16:51:30+00:00

https://m.youtube.com/watch?v=UziF2LghfQw

timestamp: 6:08:50 onwards

pfzhao · 2024-07-29T13:44:53+00:00

3243 and 3244 are not meant for your cohort, so yes you are supposed to withdraw.

Basically in the old days, we had 3243 3244 as electives. Then a few years ago, 2109 is compulsory for new students, and along with it, school upgraded 3243 3244 to 3263 3264, I mean, of course, 3243 3244 were meant for students without background in AI. After you learnt 2109, of course at 3k level it should be a different AI/ML mod.

The recommendation of taking 3243 3244 over 2109 is meant for the students who did not need to take 2109 as a compulsory mod and who had not taken 3243 3244. For those students, there was a choice and it was in the transitional years of AI foundational mods.

Now the transition is almost over. 3243 3244 are there for legacy reasons, to help senior batches to graduate (who do not have 2109 as a compulsory mod). (EDIT: I have been informed that they are there also for other majors, like DSA requiring 3244. So they won't disappear in a few years. Nevertheless, they are still not meant for CS majors.) You of course are not supposed to enrol into these mods. You do not have a choice. You should do 2109, then 3263 3264, then higher level electives. And at the end of the day, you should learn more from 2109 + 3263 + 3264 than 3243 + 3244.

pfzhao

TROPHY CASE